(Bloomberg) — Thai protesters began to rally in Bangkok on Saturday to demand the resignation of Prime Minister Paetongtarn Shinawatra, as the fallout continued from her controversial phone call with former Cambodian leader Hun Sen.
Demonstrators gathered at the Victory Monument junction, a key intersection in the capital, waving flags as monks prayed and chanted on a stage. Organizers brought the rally forward by six hours, with crowds expected to become larger as the day progresses.
Paetongtarn has resisted calls to step down after a leaked call with Hun Sen was released in which she criticized her army, prompting a key coalition ally to defect and her government to nearly collapse this month. The political turmoil compounds woes of Southeast Asia’s third-biggest economy, which has been hurt by US tariff threats, a tourism downswing and a consumption slump.
The crisis has also weighed on international investors, who have dumped a net $2.3 billion of Thai stocks this year. Thailand’s benchmark stock index has slid 21% this year — among the worst performers globally — largely on concerns that US threats of a 36% tariff will worsen the economic slowdown and hurt company earnings.
The gauge tumbled 2.2% on Friday as some investors cut their exposure of domestic stocks ahead of the weekend street protest.
“Domestic politics have returned to trigger extreme volatility in the stock market again,” said Nariporn Klangpremchitt, an analyst at Thanachart Securities Co. Investors are selling off Thai stocks on concern the protest and political uncertainty “will affect the government’s stability and economic policy implementation,” she said.
A coalition without Bhumjaithai Party, formerly the alliance’s second-biggest group, commands a very slim majority. That could complicate passage of key bills in July, including a controversial proposal to legalize casinos and the next fiscal year’s budget.
The rest of Paetongtarn’s coalition allies have pledged to remain for now.
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